Lockheed Martin's F-35 stealth fighter is a beautiful aircraft. So why is the U.S. Navy "just not into" it? Photo source: Lockheed Martin.

Across the U.S. Air Force, Navy, and Marine Corps, 185 F-22 Raptor stealth fighters and 85 F-35 Lightning II stealth fighters are now in active service, according to the latest figures published by Flightglobal. Thus, the U.S. military now boasts the largest fleet of fully fifth-generation stealth fighter jets in the world.

And that might have been a mistake.

Construction of the F-22 fleet wrapped up in 2012, but thousands of F-35s are still awaiting purchase. Ultimately, across the three services, the Pentagon plans to buy more than 2,400 units of the F-35 from Lockheed Martin (LMT 0.27%). Some analysts now put the lifetime cost of the program at $1.5 trillion. Already, though, the Pentagon is planning for "what comes next" after the F-35.

More and more often, they're saying it might not involve "stealth" at all.

Enter the Admiral
Earlier this month, USNI News quoted U.S. Chief of Naval Operations Adm. Jon Greenert opining that "stealth may be overrated" -- and potentially, not worth that $1.5 trillion expense.

In planning for a new "sixth-generation" fighter jet to follow the F-35, Greenert pointed out that "stealthy" is not the same thing as "invisible." Said the admiral: "If something moves fast through the air and disrupts molecules in the air and puts out heat -- I don't care how cool the engine can be -- it's going to be detectable."

In fact, China says it already has a radar system capable of detecting the F-35 at distances of 240 to 360 miles. By processing "pulse, frequency agility, pulse duration, tactical air navigation system, distance measuring equipment, jitter/stagger radar, and identification friend or foe" signals emitted by the otherwise stealthy aircraft, China says it can detect an F-35 at distances two to three times beyond the range of the F-35's AMRAAM missile.

If true, that largely negates the advantages of stealth.

If not stealth, then what?
Now add to that negation the fact that Lockheed Martin's F-35 is only truly stealthy when partially loaded. Fully loaded, the F-35 can carry 3,000 pounds of munitions within its internal bomb bays, and a further 15,000 pounds attached to six external hardpoints along its wings. Attaching bombs to those hardpoints, however, clutters up the aircraft's silhouette, making it easier to spot on radar. To achieve its full stealth potential, therefore, the F-35 is limited to whatever weapons it can carry internally -- just 17% of a full weapons load.

"Bombs away! And darn it, now I need to reload." Photo source: Lockheed Martin.

For the U.S. Navy, that's a problem. Accustomed to being able to deliver large quantities of ordnance via Boeing (BA 0.15%)-built F/A-18 Super Hornets, naval aviators are reportedly less than thrilled with the F-35's inability to carry full weapons loads while remaining stealthy. Consequently, the service is seriously considering abandoning stealth when drawing up plans for a warplane to replace the F/A-18, beginning sometime in the 2030s.

If that's how things work out, Lockheed could lose any advantages gained from being America's "stealth leader" in future competitions to build the next generation of fighter jets (which the Navy calls "F/A-XX"). Perversely, being overly specialized in stealth could be seen as a negative.

And that's the good news.

The future for Lockheed Martin -- and what it means for investors
The bad news is that the Navy's lack of enthusiasm for the F-35 could translate into reduced revenue for Lockheed today.

At last report, the U.S. Navy had only nine F-35s (the F-35C variant) in service, with two more ordered for 2015, and four for 2016. (Congress upped the 2015 order to four aircraft, unasked.) That makes the Navy the slowest adopter of the aircraft among the three services using the F-35. As defense analyst Richard Aboulafia, vice president of analysis at the Teal Group, told Navy Times earlier this month, the Navy is "just not that into the F-35."

Indeed, Aboulafia said the Navy could cut its buy down to just 200 F-35Cs in total -- 23% fewer than the 260 originally planned. At $154 million per aircraft, that's a potential $9.2 billion loss of revenue to Lockheed.

And even that's not the worst possible scenario.

"There are some officers in the Navy," warned Aboulafia, who would prefer to "shift all funding to the sixth generation" -- to skip further F-35 purchases, make do with present-day fourth-generation aircraft, and save the service's money for investment in the envisioned new F/A-XX aircraft.

Such a move would siphon further billions of dollars away from Lockheed Martin -- potentially shunting the money toward Boeing and Northrop Grumman (NOC -0.55%) instead. Boeing is expected to bid on the F/A-XX contract, already builds the F/A-18, and continually urges the Navy to buy its F/A-18s instead of Lockheed's F-35s. For its part, Northrop collaborates with Boeing in building the F/A-18's electronic warfare analog, the EA-18 Growler. Northrop also built the F/A-18's predecessor, the F-14 Tomcat.

One warplane the U.S. Navy is definitely "into" -- Boeing's F/A-18. Photo source: Flickr.

Lockheed responds
Lockheed naturally bristles at this suggestion. Quoted in the Navy Times, a Lockheed representative argued, "Stealth provides a huge, almost immeasurable advantage because of adversaries' difficulty in detecting the F-35 by the use of either ground-based or airborne radar." Lockheed insists that "no other fighter system provides that level of survivability."

And yet, that remark by Aboulafia echoes: "They're just not that into you." Until Lockheed Martin wins over its detractors, its revenue will be at risk.

Northrop Grumman's F-14 Tomcat launched Tom Cruise to fame. Could another Northrop aircraft be a contender for F/A-XX? Photo source: Flickr.